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Council rejects downtown purchase; directs manager to end due-diligence period
Summary
A proposed $2.6 million purchase and net-lease agreement for 406 Washington Ave failed after council debate over cost, environmental risk, and public benefit; council later voted to direct the city manager to terminate the due-diligence period for the acquisition.
Council members voted down a proposed purchase-and-financing arrangement for 406 Washington Avenue (a CRA-sponsored downtown acquisition) after extended debate on Feb. 18.
Public commenter Diego Rivaleneta, a retired real-estate professional, questioned the structure and price, asking, "Is this the highest and best use of $2,600,000 of taxpayer money at this moment?" He warned that demolition and environmental assumptions could reduce the property's value and questioned owner-financing terms. CRA staff and other councilmembers said additional appraisals and phase 2 environmental reports had been completed and that the plan had been vetted as part of CRA strategy for downtown control and revitalization.
The motion to proceed with the acquisition failed on a roll call vote. Following the failed motion, council considered whether to direct the city manager to exercise rights under the contractual due-diligence period. The council voted to direct the manager to issue termination notice under the due-diligence provisions, effectively ending the city's near-term option to acquire the property under the proposed terms.
What this means: The city will not proceed with the proposed loan and purchase as written; staff said they will act in accordance with the termination direction. The outcome preserves CRA funds for other uses and leaves the property in private hands unless a later agreement is negotiated and returned to council.
